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ROLE OF

FINANCIAL SECTOR DEVELOPMENT

IN ECONOMIC GROWTH

(THE CASE OF FIJI)

By: Tebaio Ioane

Research Project

Course: EC410 Monetary Economics


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1. AbstractThe literatures such as those from King and Levine (1993), Levine (1997), Mishkin (1999), Khan

and Senhadji (2000) have found empirical evidence which highlights a positive role of the financial

sector in aiding growth and development in both developing and developed countries. Most implied

that the financial sector in its role of pooling savings and diverting them to innovative investment

opportunities does contribute to economic growth and development because it facilitate and

stimulate capital accumulation and technological progress, the factors which according to neo-classical growth models, contribute to economic growth. In that connection, they recommended that

if countries wish to develop their economies, their financial sector needs to be supported and

developed both in its deepening, variety and access to the population especially the rural areas so

that it can perform its intermediation functions properly.

To see whether the same observations also holds in Fiji, we analyse the data for Fiji on financial

deepening, domestic credit and interest spread for the years 1995 to 2007 and compare their growth

with GDP and found that there is a strong positive correlation especially between interest spread,

quasi money, credit to the private sector and GDP. We also noted a fast transmission time within

one year, in a change in interest spread and the increase in the quasi money, the credit to private

sector and the growth of GDP indicating an efficient intermediary functions performed by thefinancial sector in Fiji implying their development advancement.

In view of those factors, we conclude that the financial sector in Fiji does play a positive role in the

economic growth of Fiji.

2. Introduction

The purpose of this paper is to find out whether financial sector does play some role in aiding

growth in Fiji. To do that we need to find what the measures or indicators show financial

development from researchers who have done similar studies and then see their results on the role

which these variables have on growth. We then apply the same principal and approach using Fijidata to assess whether financial sector does play a role in aiding growth here in Fiji.

However, before we begin we must first define the terms financial sector andeconomic growth

so that we can limit the scope of the paper within the economics definitions of these terms.

According to Wikidepia, Financial sector is simply a collection of institutes and markets whichtransact money and credit instruments. They include the banking sector composed of commercial

banks and the reserve bank plus the non-bank institutions such as National Provident Funds (NPF),

Development Financial Institution (DFI), Insurance Companies, Credit Institutions such as miro-

finance institutions, merchant banks, etc. In that connection therefore, financial sector development

means the ability of these institutions to perform their intermediary functions in such a way that it

stimulate growth. Economic growth is an increase in the countrys aggregate output or income over time and it Gross Domestic Product (GDP) is often used as the indicator especially its per

capita value. Hence when GDP per capita increases from the previous year, economic growth is

then achieved.

But sometimes the role of money and financial sector are confused as some may treat them as the

same therefore we have decided to also include a study to differentiate money and financial sector

in the growth theory.

Section 3 will discuss selected literatures, section 4 the analysis on the data for financial deepening,

domestic credit, and interest rates and their spread. In section 5 we discuss our findings on those

analyses and then make some conclusions in section 6.


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3. Literature ReviewTo fully understand the connection between the financial sector development and economic growth,

it is better if we start from the growth theory so that we can grasp the main variables which

stimulate growth. According to the neo-classical or the exogenous growth model and the Solow

model (Solow, 1956) in particular, the factors that affect economic growth are capital stock

accumulation and improvement in technology. The model is given in a Cobb-Douglas production

function given as:

1)}()({)()( tLtAtKtY 0 < < 1 (1)

Where Y is output, K capital, L labour, A is the level of technology and t is time. A and L are

assumed to grow exogenously at the rates n and g: nteLtL )0()( and gteAtA )0()( . In the

extended form of the Solow model, human capital is included to make the model more accurate in

the level of its prediction with stylized facts (Mankiw et. al, 1992). Accordingly they extended the

model as below:

1

)}()({)()()( tLtAtHtKtY (2)

Where H is the stock of human capital which is knowledge, training and experience while the other

variables remain as in equation (1). In addition, the authors also stated that the inclusion of human

capital now divides or splits the amount invested as a fraction goes to capital while the other

fraction or the rest is invested in human capital.

The endogenous growth model on the other hand postulates that human capital and technological

progress are also the main drivers for growth. Its difference with the neoclassical growth model is

that the input factors are endogenous or are part of the model and therefore they can be manipulated

through savings rate, training or learning by doing and research and development to get the desired

growth rate.

The question then is how the financial sector is involved in the growth theory? Does it has any role

in stimulating and facilitating growth and if so is it direct or indirect. Some economists (Sinai and

Stokes, 1972) argued that money has a direct role in the growth theory and they used the extended

Solow model as in equation (1) and also including various definitions of real money balances into a

non-constant Cobb-Douglas production function as below:

teMKALY (3)

Where M is M1 or M2, t is time trend and is the error term and other variables are the same asthose in equation (1). They used the US data for 1929 67 and statistical manipulation, they

concluded that real money was a significant input and its contribution was mistakenly attributed as

technological progress. Similar conclusions were also made by Ali F Darrat and Yousif K Al-

Yousif (1998) who applied a similar econometric approach using data from Kuwait, Saudi Arabia

and the United Arab Emirates. These findings implies that there may be no need for society to

educate itself and invest to find new technologies as these investments would not contribute to

growth.

Other researchers were not convinced and according to Hong V Nguyen (1996) who reviewed the

Sinai and Stokes (1972) study but instead of using only one time period, he used two times periods,

the 193067 originally used by Sinai-Stokes (1972) and sub-periods 1947 67 and 1947 78 toevaluate the stability of the previous results with respect to the role of money as an input. The


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regression results indicated that money played a statistically significant role as an input for period

1930 67 however the results were opposite for periods 1947 67 as they showed that money,

either M1 or M2 is not statistically significant with or without time trend. The 1947 78 data also

did not support that trend is a proxy for money hence these implied that the Sinai-Stokes (1972)

conclusion that money is an input in the growth model was not plausible.

Nguyen (1996) then reformulated the Sinai-Stokes (1972) equation to capture the effects of changesin money as well as changes in technology on productivity. The new formulation is given below:

teMKALY (4)

)/( MMrd (4a)

Where M/M is proportionate change in M, d captures changes in the rate of productivity due to

technological change and r captures the interaction between the rate of growth of real money

balances and technological change. Other variables are the same as those in equation (3). After

running the regressions, Nguyen (1996) found that coefficients for interaction variables are not

sensitive to adding or dropping money variables for 194767 and 194778. Money (M1 and M2)

coefficient in 1947 67 and 1947 78 is significantly reduced and remain insignificant when the

interaction variable is added and for periods 193067, M2 is no longer significant in the regression

with the interaction and trend variables. He then concluded that money is related to and affected by,

exchange innovations and that money plays a role not as an input but as a factor whose growth rate

contributes to productivity growth which is then transformed into higher per capita output and

ultimately to higher growth.

It is now clear that money does not affect economic growth directly as it is not an inputs to the

production function. However as Nguyen (1996) concludes, the availability of money in the

production system does improves productivity.

This may imply that anyones productivity may increase as the level of salary is increased but in

looking at the firm, increased productivity of its employees due to increased in salary may notnecessary mean increased efficiency of the firm as if the capital-labour ratio falls because there is a

relative decrease in capital accumulation because the firm cannot find additional money to buy

replacement capital to replace the depreciated units, then the workers productivity would fall

regardless whether the pay is increased. In addition, the firm also needs transactions between other

firms and its customers to be efficient as well and that where the role of the financial system comes

into playthat is, it is not just the money being introduced into the system but also the financial

system itself and its efficiency to fulfil its roles like pooling of capital resources and transmitting

them to investment capitals and in facilitating trade transactions and contracts, to say a few wouldhave a very important impact on the efficiency of the monetary economics system, the productivity

of the firms and therefore economic growth.

How can the financial sector perform its intermediary function and transmit savings into

investments and in the process help stimulate growth? As it is known, the banking system operate

on a fractional-reserve banking practice where for any amount deposited, Commercial Banks(CBs) deposit the required reserve portion of the deposit with the Reserve Bank (RB) and lend outthe remainder to the appraised and selected prospective investors. It is assumed that the dealers,

whom the investors bought the machinery from, would redeposit that same loan money into the

banking system to complete the money-making cycle so that the process can start over again. This

cycle if carried out efficiently by the CBs, would help to accelerate the expansion of the economysimply through introducing new businesses or capitals and/or expanding the existing ones. In

addition it also creates new money into the system.


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supply (MS) or broad money (M2) which is made up ofnarrow money (consists of currency anddemand deposits) plus quasi money (made up of savings and time deposits). They concluded thatthese components of MS and quasi money in particular as well as M2 because they contain longer

term deposits which the Commercial Banks (CBs) can lend out to borrowers, have a strongcorrelation with growth. Table 1 below tabulates the components of M2 for Fiji for the years 1995

to 2007 and I will try to determine if their growths are also correlated with GDP growth.

Table 1: Fijis GDP and Financial Deepening Statistics (F$ million)

YearNominal

GDP CurrencyNarrowmoney

Quasimoney M2

1995 2373.0 117.8 386.2 1089.6 1475.7

1996 2578.4 125.4 456.3 1032.1 1488.4

1997 2590.9 134.0 445.3 913.2 1358.5

1998 2776.2 159.8 493.9 859.9 1353.8

1999 3080.8 189.9 694.5 851.6 1546.1

2000 3063.1 163.3 693.7 920.1 1513.9

2001 3249.1 181.7 620.9 846.2 1467.12002 3386.9 202.6 712.0 870.6 1582.5

2003 3564.0 226.2 900.0 1080.5 1980.5

2004 3856.1 252.3 1018.0 1167.7 2185.7

2005 3977.4 280.1 1197.1 1316.7 2513.8

2006 4647.7 294.2 1142.4 1869.9 3012.3

2007 4555.4 290.0 1638.0 1686.0 3325.9Source: Reserve Bank of Fiji

As shown in figure 1 below, all the M2 components increased as GDP grew. In other words, none

declined while GDP increased. This implies that M2 and its components have a strong link withGDP in Fiji also as the other researchers found for other countries and this suggests that financial

deepening also helps to enhance economic growth in Fiji. Figure 1 also shows that quasi money

curve sort of mimic the GDP curve implying that CBs lend out all of the short term deposits with

them.

Figure 1

Financial Deepening and GDP

0.0

500.0

1000.0

1500.0

2000.0

2500.0

3000.0

3500.0

4000.0

4500.0

5000.0

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Year

F$(million)

Currency Narrow money Quasi money M2 GDP (at market price)


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Table 2 below shows the same components of M2 and compare them with GDP by means of ratio

or percent of GDP.

Table 2: Fiji Financial Deepening Statistics (percent of GDP)

Year Currency

Narrow

money

Quasi

money M21995 5.0 16.3 45.9 62.2

1996 4.9 17.7 40.0 57.7

1997 5.2 17.2 35.2 52.4

1998 5.8 17.8 31.0 48.8

1999 6.2 22.5 27.6 50.2

2000 5.3 22.6 30.0 49.4

2001 5.6 19.1 26.0 45.2

2002 6.0 21.0 25.7 46.7

2003 6.3 25.3 30.3 55.6

2004 6.5 26.4 30.3 56.72005 7.0 30.1 33.1 63.2

2006 6.3 24.6 40.2 64.8

2007 6.4 36.0 37.0 73.0Source: Reserve Bank of Fiji

Now even though GDP grew for the years 1995 to 2007 as shown in Figure 1 above, the share of

M2 as well as quasi money to GDPs growth however have been declining since 1995 and increased

again in 200203. This may indicate a decline in the level of term deposits in those periods may be

due to decrease in interest on deposits shown in table 5 and figure 7, which may have forced

potential term depositors to opt for the next best form of deposit or investment.

Figure 2

Financial Deepening Indicators (percent of GDP)

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Year

Percent

Currency Narrow money Quasi money M2

Now that we have analysed the deposits made by the commercial banks we can now analysewhether they lend out the said deposits to make money and in the process stimulate economic

growth by contributing to pay for the new capital and technologies. According to King and Levine


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(1993), they claimed that the loan to private sector is a better measure as they are the sector which

uses the said loans to accumulate national capital and new ideas or technologies. Table 3 below is

Fiji financial sector credit or loan values for 1995 to 2007 to both the private and public sector or

government.

Table 3: Fiji GDP and Domestic Credit Statistic (F$ million)

Year NominalGDP

Credit toPrivateSector

Credit toPublicSector

TotalDomesticCredit

1995 2373.0 1112.2 156.7 1268.9

1996 2578.4 1165.0 157.0 1322.0

1997 2590.9 1013.9 173.6 1187.5

1998 2776.2 1072.2 160.0 1232.2

1999 3080.8 1143.3 141.8 1285.1

2000 3063.1 1145.9 212.9 1358.8

2001 3249.1 1081.8 242.8 1324.6

2002 3386.9 1136.1 255.7 1391.82003 3564.0 1326.4 336.4 1662.8

2004 3856.1 1565.8 305.4 1871.2

2005 3977.4 1949.3 419.4 2368.7

2006 4647.7 2411.5 516.1 2927.6

2007 4555.4 2479.0 540.0 3019.0Source: Reserve Bank of Fiji

Figure 3 below compared the growth of the said credits with GDP and it is clearly shows that the

majority of the credits handed out each year go to the private sector. This implies that the financial

system is arranged in such a way that the private sector is not crowed out from the credits madeavailable by the banking system.

Figure 3

Composition of Domestic Credit

0.0

500.0

1000.0

1500.0

2000.0

2500.0

3000.0

3500.0

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Year

F$(millio

n)

Credit to Private Sector Credit to Public Sector

It then follows that the loan arrangements implied above would assist to stimulate growth because

most of the loan is made to private sector. To find out if that view is true, we go to figure 4 below.


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Figure 4

Domestic Credit and GDP

0.0

500.0

1000.0

1500.0

2000.0

2500.0

3000.0

3500.0

4000.0

4500.0

5000.0

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Year

F$(million)

Credit to Private Sector Credi t to Public Sector Total Domestic Credi t GDP (at market price)

It can be seen in figure 4 above that the credit to private sector curve kind of copies the GDP curve

but at the lower level. This implies that it does influence GDP growth pattern. The credit to public

sector curve on the other hand does not copy the GDP curve as even though it grows, it does so at a

very minimal rate while GDP and the private sector curves grew and declined almost at the same

rate through out the periods under study.

Table 4: Fiji Domestic Credit Statistic (percent of GDP)

Year

Credit toPrivateSector

Credit toPublicSector

TotalDomestic

Credit

1995 46.9 6.6 53.5

1996 45.2 6.1 51.3

1997 39.1 6.7 45.8

1998 38.6 5.8 44.4

1999 37.1 4.6 41.7

2000 37.4 7.0 44.4

2001 33.3 7.5 40.82002 33.5 7.5 41.1

2003 37.2 9.4 46.7

2004 40.6 7.9 48.5

2005 49.0 10.5 59.6

2006 51.9 11.1 63.0

2007 54.4 11.9 66.3Source: Reserve Bank of Fiji

If we analyse the domestic credit components opposed to GDP as shown in table 4 above and figure

5 below, we can see that it represent a similar graph as that shown in figure 2 above especially forthe curves credit to private sector and M2 and quasi money. That is both curves show an initial

decline and then a rise from 2002 onwards. As discussed earlier, CBs use the deposits to make more


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money through loans hence the pattern makes sense because when the deposit money decreases,

then that would affect the level of money which banks lend out therefore both the savings and

lending curves would be similar.

Figure 5

Domestic Credit (% of GDP)

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Year

Percent

Credit to Private Sector Credit to Public Sector Total Domestic Credit

Now if we combine the M2 and credit to private sector with GDP and determine their growth rates,

we can see in figure 6 below that they grow pretty much in a same manner through out the years

under study. All of them declined in 1997 and in 2001 and grow in the other years.

Figure 6

Growth rates: M2, Credit to Pvt Sector & GDP

-15.0%

-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

Year

Percent

M2 0.9% -8.7% -0.3% 14.2% -2.1% -3. 1% 7.9% 25.2% 10.4% 15.0% 19. 8% 10.4%

Credit to Private Sector 4.7% -13.0% 5.8% 6.6% 0.2% -5.6% 5.0% 16.8% 18.0% 24.5% 23.7% 2.8%

GDP (at market price) 8.7% 0.5% 7.2% 11.0% -0.6% 6.1% 4.2% 5.2% 8.2% 3.1% 16.9% -2.0%

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

A further analysis on their growth rate and pattern of growth indicates that they are highly

correlated as shown in figure 7 below. All of them sort of grow and decline in the latter parts of

1990s and early 2000s but increased sharply in mid 2000s. The Excels internal analysis forecasted

each of the curves linear trend lines and equations where x stand for the year multiplied by theelasticity or growth rate per year plus the value at the origin. The R

2for each curve showed a very


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high figure for the GDP curve indicating a high probability while the other curves have lower

figures hence lower probabilities.

Figure 7

GDP, M2 and Credit to Pvt Sector

y = 184.16x + 2072.4

R2

= 0.9566

y = 147.12x + 878.21

R2

= 0.752

y = 109.96x + 661.23

R2 = 0.6865

0.0

500.0

1000.0

1500.0

2000.0

2500.0

3000.0

3500.0

4000.0

4500.0

5000.0

Year

F$(million)

M2 1475.7 1488.4 1358.5 1353.8 1546.1 1513.9 1467.1 1582.5 1980.5 2185.7 2513.8 3012.3 3325.9

Credit to Private Sector 1112.2 1165.0 1013.9 1072.2 1143.3 1145.9 1081.8 1136.1 1326.4 1565.8 1949.3 2411.5 2479.2

GDP (at market price) 2373.0 2578.4 2590.9 2776.2 3080.8 3063.1 3249.1 3386.9 3564.0 3856.1 3977.4 4647.7 4555.4

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

The literatures especially the Asian Development Bank (ADB) report (2001) stated that the interest

rates spread is a very good indicator of the level of competition within the financial sector. This

happens because as more banks and financial institutions exist in the market, competition would

force them to lower their interest rates and operate efficiently. This means that when the interest

spread is low, then the financial system is competitive and therefore there is development takingplace within the financial market. Table 5 and figures 8 and 9 below shows the interest rates

behaviour for the years 1995 to 2007.

Table 5: Nominal Interest rates on Savings and Lending

YearDeposit

rates

WeightedAverage

Lending ratesInterestSpread

1995 6.78 11.10 4.32

1996 5.77 11.57 5.80

1997 5.18 10.17 4.99

1998 4.01 9.11 5.10

1999 2.88 8.47 5.59

2000 3.00 8.37 5.37

2001 2.43 8.19 5.76

2002 2.17 7.89 5.72

2003 1.70 7.39 5.69

2004 1.77 7.03 5.26

2005 2.03 6.63 4.60

2006 9.05 7.90 -1.15

2007 4.45 8.46 4.01Source: Reserve Bank of Fiji


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It can be seen in figure 8 below that even though both the deposit and lending interest rates were

declining in general, the spread remains more less the same except for 2006 when the deposit rate

was higher than the lending rate. This is very unusual as it would imply an operating loss for the

banks but it was a figure given by the RBF for that year.

Figure 8

Interest on deposit and lending and spread

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Year

Percent

Deposit rates Lending rates

The spread curve shown in figure 9 below shows a small deviation for most of the except at the

initial period in 1996 when the spread rose initially and in 2006 when it was in a negative meaning

the deposit rate is higher than the lending rate.

As stated earlier the rates are linked to the level of deposits made. We would then expect anincrease in deposits to occur in 2006 and as shown in figure 1, the level of quasi money jumped in

2006. Now with larger deposits CBs would lend out more hence an increase in lending for the same

period is expected as shown in figure 7 above, there was a sharp increase in credit to private sector

in 2006 also and as anticipated, there is also a sharp increase in the level of GDP shown in the same

figure 7 in 2006.

Figure 9

Interest Spread

-2.0

-1.0

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Year

Percent


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This means that there is a clear correlation between the decision to have a higher interest on deposit

with the level of deposits and credits made and their clear implication on growth. In other words

had the deposit rate in 2006 been relatively similar to that of 2005 then GDP growth for 2006 would

have not been very sharp.

5. Results

In view of the explanation above we can find that the literatures indicated that the development ofthe financial sector can affect economic growth positively. It also showed that financial deepening

measures as well as the level of domestic credit and the interest rates spread are good indicators to

assess the level of financial development. A comparison between the changes in these measures

with that of economic growth measured by GDP growth would then indicate whether there is a link

between financial development and GDP growth.

In doing an analysis for Fiji on the development of financial deepening and growth, we found that

both are linked especially between the growth of quasi money and GDP growth. We also found that

the growth of quasi money was affected by the deposit rate that is when the deposit rate is lower,

the level of quasi money is also low.

When we analysed the linkage between domestic credit and growth, we found that credit to private

sector is highly correlated with GDP growth and therefore when we combined the variables together

we found that the level of deposit interest would affect the level of saving deposits especially those

saved in a longer time period savings (term deposits). These kinds of savings are then used by banks

to generate revenue through loans of which the majority went to the private sector. It is assumed

that the private sector then used the loan money to carry out economic generating activities

including procurement of new capital equipments, implementation of new innovative ideas and help

in the cost of training, key determinants of economic growth. This explains the clear correlation

between interest rate, quasi money, credit to private sector and GDP in as far as Fiji is concerned.

We also found that the financial sectors ability to pool savings in relatively a short time when the

decision has been made to have a higher deposit interest rate than the lending rate in 2006 as shown

in a high spike of deposits during that period is quite impressive. In addition, the sectors ability to

quickly transform those increase deposits into investments through lending within the same

financial year were also impressive and this implies an advance and well developed financial

intermediation system in as far as the Pacific context is concerned.

Of course, the above results are just observations from the trends shown above however a more in-

depth econometric analysis on the relationship between the financial sector development and

growth in Fiji is needed to further confirm the above on the surface findings.

6. ConclusionIn view of the findings discussed above and in the said absence of the in-depth econometric

analysis, we can conclude that the development of financial sector and especially its ability to carry

out its intermediation functions well does plays a positive role in enhancing economic growth in

Fiji. In that connection it can be safely concluded that monetary policies in Fiji for the last ten years

may have been pro-growth.


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7. ReferenceAsian Development Bank Financial Sector Development in the Pacific Developing Member Countries vol1, The Regional report Asian Development Bank (2001).

Darrat, Ali and Yousif K Al-Yousif, Does Money Matter in Developing Economies? Some Evidence fromthe Solow Estimator, Review of Financial Economics, Vol. 7(2), pp. 213 20

Fry Maxwell J In favour of Financial Liberalisation The Economic Journal, Vol. 107 (May 1997) pp. 754 770

Khan S and Senhadji Financial Development and Economic Growth: An Overview IMF Working Paper,(Dec 2000)

King Robert G and Ross Levine Finance and Growth: Schumpeter might be right The Quarterly Journal ofEconomics, Vol. 108, No. 3 (Aug 1993, pp. 717737, MIT press

Levine Ross Financial Development and Economic Growth: Views and Agenda Journal of EconomicsLiterature, Vol. XXXV (June 1997), pp. 688 - 726

Mankiw N Gregory, David Romer and David N Weil, A Contribution to the Empirics of EconomicGrowth, (May 1992), pp. 408 33

Mishkin Frederic S Global Financial Instability: Framework, Events, Issues Journal of EconomicPerspectives, Vol 13, No. 4 (Fall 1999) pp. 320

Nguyen V Hong, Money in the Aggregate Production Function: Reexamination and Further Evidence Vol.18, No. 2 (May 1986), pp. 14251

Reserve Bank of Fiji, Quarterly Review December 2008 Tableshttp://www.reservebank.gov.fj

Sinai Allen and Houston H Stokes, Real Money Balances: An Omitted Variable in the ProductionFunction? Review of Economics and Statistics 54 (May 1975), pp. 247 52

Wikipedia Fractional-reserve bankinghttp://en.wikipedia.org/wiki/Fractional-reserve_banking

Wikipedia Money supplyhttp://en.wikipedia.org/wiki/Money_supply

Wikipedia, Economic growthhttp://en.wikipedia.org/wiki/Economic_growth
http://www.reservebank.gov.fj/http://www.reservebank.gov.fj/http://en.wikipedia.org/wiki/Fractional-reserve_bankinghttp://en.wikipedia.org/wiki/Fractional-reserve_bankinghttp://en.wikipedia.org/wiki/Money_supplyhttp://en.wikipedia.org/wiki/Money_supplyhttp://en.wikipedia.org/wiki/Economic_growthhttp://en.wikipedia.org/wiki/Economic_growthhttp://en.wikipedia.org/wiki/Economic_growthhttp://en.wikipedia.org/wiki/Money_supplyhttp://en.wikipedia.org/wiki/Fractional-reserve_bankinghttp://www.reservebank.gov.fj/

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